NPC postpones task of fixing budget ceiling

KATHMANDU:

The National Planning Commission (NPC), the apex body that frames the country’s development policies, has decided to postpone the task of fixing budget ceiling for the next fiscal year until new Cabinet takes full shape.

The announcement comes at a time when NPC is almost a month behind the deadline of extending budget ceilings to various ministries.

“Although we are working on the size of the annual budget for the next fiscal, we thought it would be appropriate to discuss the matter once the new government takes full shape. We will then send the ceilings to various ministries,” NPC vice chairman Dr Rabindra Kumar Shakya said.

NPC’s Resource Committee, which comprises of NPC vice chairman, Nepal Rastra Bank governor and finance secretary, among others, generally comes up with the annual budget ceiling for next fiscal within first six months of the ongoing fiscal, or mid-January. Based on this, Ministry of Finance fixes the annual budget.

At the time of setting the budget limit, the Resource Committee also fixes the budget cap for various ministries. The ministries will then have to allocate budget for various projects to be implemented in the next fiscal by remaining within the ceiling.

For the next fiscal, the committee had earlier fixed a budget ceiling of around Rs 600 billion, meaning the annual expenditure of the government should not exceed this amount next fiscal. The committee had come up with this figure based on revenue collection target of around Rs 418 billion and foreign aid mobilisation target of around Rs 128 billion in the next fiscal.

The annual expenditure amount proposed by the committee for fiscal 2014-15 is around 16 per cent higher than Rs 517.24 billion allocated for this fiscal. Albeit hiccups in setting the budget cap for next fiscal, NPC has already fixed ceiling of Rs 73.99 billion for 75 districts in the country.

Of this amount, the biggest ceiling of Rs 29.49 billion has been extended to the Ministry of Federal Affairs and Local Development, followed by Rs 23.49 billion to the Ministry of Education and Rs 9.33 billion to the Ministry of Health and Population.

Among others, the Ministry of Agricultural Development has been extended a budget cap of Rs 5.18 billion, the Ministry of Urban Development Rs 3.75 billion, the Ministry of Forests and Soil Conservation Rs 890 million, the Ministry of Women, Children and Social Welfare around Rs 580 million, the Ministry of Culture, Tourism and Civil Aviation around Rs 490 million and the Ministry of Industry around Rs 350 million.

The ministries will forward these ceilings to all district development committees. They will then have to prepare programmes for the next fiscal by remaining within this limit.

Source: THT